Chrysler dealers not panicking

Thursday

Apr 30, 2009 at 12:01 AMApr 30, 2009 at 3:16 AM

Local auto dealers remain optimistic they’ll still be selling Chrysler-made cars once the automaker emerges from bankruptcy, despite plans to cancel some dealer contracts as part of the company’s restructuring.

Sean F. Driscoll

Local auto dealers remain optimistic they’ll still be selling Chrysler-made cars once the automaker emerges from bankruptcy, despite plans to cancel some dealer contracts as part of the company’s restructuring.

Since March 2008, Chrysler has reduced its number of dealers by about 9 percent as part of Project Genesis, an effort to reduce overhead by selling cars only through dealerships that sell Chrysler, Jeep and Dodge products.

In March, 61 percent, or 1,992, of Chrysler dealers sold all three Chrysler brands, compared with 55 percent a year ago, according to the company. Although no local dealers sell all three brands, none have closed as a result of the ongoing consolidation.

“My belief is that we’re going to be here as Chrysler dealers a year from now, and I think the dust will settle and we can get this thing put to bed,” said Dave Lusz, general manager at Anderson Dodge, which employs 53. “We’ve not been happy with the way business has been, but all in all I think we’re going to be here doing business.”

Dean Zimmerman, general manager at Strandquist Motor Co., which sells Chrysler vehicles and employs about 30, said he thinks the bankruptcy will strengthen local dealers.

“Fiat brings a type of car that Chrysler certainly can use, and obviously we bring something to them as far as distribution areas to sell in this country,” he said. “That’s a nice little marriage.”

Zimmerman said the guarantees announced Thursday — the Obama administration said the government will back Chrysler vehicle warranties — will reassure car buyers it’s safe to purchase a Chrysler car during the bankruptcy.

Among them is the merging of Chrysler Financial, the arm of the company that makes loans to buyers and to dealers to finance their inventories, into GMAC Financial Services, once General Motors Corp.’s finance arm. The new GMAC will get government support.

“It’s a temporary bankruptcy. It isn’t like it’s going to be years and years,” he said. “The incentives are there. If something did happen, the warranty’s backed by the government. There’s financing through GMAC. I think Chrysler itself is doing everything they can to take the burden off the customer’s mind.”

Robert Dixon, owner of Dodge dealership Belvidere Motors, said he feels secure that Chrysler’s bankruptcy will result in a stronger company. He’s also as sure as he can be that his 40-year-old dealership, which employs 23, will survive.

“You never know. It could happen to anyone,” he said. “Right now, we’re one of their leading sales producers. As long as you have a good facility and keep up your cars, you’re in their good graces. They’ve got to cut out the risky dealers, but we feel comfortable.”

Sean F. Driscoll can be reached at (815) 987-1346 or sdriscoll@rrstar.com.